Federal jury finds Mark Cuban not guilty

A federal jury found Mark Cuban not guilty of insider trading Wednesday after three-and-a-half hours of deliberations, handing the billionaire a resounding victory in his five-year quest to defend himself against the government’s charges.

Bloomberg

Entrepreneur Mark Cuban in June.

The Securities and Exchange Commission had sued Cuban in civil court, alleging that he traded on material, nonpublic information when he dumped his investment in Canadian Internet search company Mamma.com in June 2004 before it announced a private offering of shares that caused its stock to drop.

At the crux of the case was an eight-minute phone conversation Cuban had with Guy Faure, the former chief executive of Mamma.com, on June 28, 2004. The SEC alleged that Cuban agreed to keep the information Faure gave him about the private share offering confidential and to not trade on it. Cuban steadfastly denied the allegations.

The stakes for Cuban were small: He faced no jail time if found guilty, only several million dollars in fine. The case arguably carried more significance for the SEC, which has been trying to project a tougher image after critics charged it was caught sleeping at the wheel during the financial crisis.

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